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LBO activity continues to disappoint in the leveraged finance markets, especially compared to hopes of a willing institutional investor base with lots of cash to put to work.

Loan activity backing leveraged buyouts during the first quarter totaled $26 billion, and much of that comes from one deal: Berkshire Hathaway's $28 billion acquisition of Heinz, which spawned some $11 billion in bank debt.

The quarterly LBO loan total, of course, is nothing compared to the $185 billion of overall leveraged loan volume seen during the period. The bulk of that activity, however, is refinancings, as issuers rushed to market to take advantage of historically low borrowing costs.

Looking forward, accounts report a disheartening lack of front-end LBO activity, suggesting that the second quarter of the year might be no busier than the first for M&A.